Process for Physical Delivery in F&O

When will I know the actual obligation of shares or funds for positions I’ve requested for physical delivery?

You will come to know your exact shares/funds obligation only after market close on the expiry day, once the final settlement file is received from the exchange.

Here’s how it works:

1. Post-market settlement file

a. After the market closes on the expiry day, the exchange releases a final settlement file.

b. This file contains details of delivery obligations for all open Futures and In-the-Money (ITM) Options positions.

2. ICICI Direct evaluates your obligations

Based on this file, ICICI Direct calculates your actual shares and fund obligations for positions where you opted for physical delivery.

3. What if there is a shortage of shares?

If your demat account doesn’t have sufficient shares as required:

a. ICICI Direct will attempt to procure the shortfall via auction.

b. Auction charges will be passed on to you.

 4. What if there is a shortage of funds?

If your trading account doesn’t have enough funds to meet the obligation:

a. ICICI Direct will try to recover the funds from your account.

b. If funds are not available, equivalent shares may be squared off to recover the balance amount.

Note:

If you want to estimate your obligation in advance:

Use the formula:

Settlement Price × Quantity of Open Position

But remember, the final obligation is confirmed only after expiry.